Financial Management

✅ The correct answer is A.
If book value is greater than market value comparison with investors for future stock are considered as pessimistic. Book value is also the net asset value of a company calculated as total assets minus intangible assets (patents, goodwill) and liabilities. For the initial outlay of an investment, book value may be net or gross of expenses such as trading costs, sales taxes, service charges and so on.

✅ The correct answer is D.
Corporate governance charter of rules of behaving is applicable on competitors, shareholders and directors.

✅ The correct answer is A.
Rate of required return by debt holders is used for estimation the cost of debt. Cost of debt refers to the effective rate a company pays on its current debt. In most cases, this phrase refers to after-tax cost of debt, but it also means the company’s cost of debt before taking taxes into account.

✅ The correct answer is D.
All of the following influence capital budgeting cash flows except method of project financing used. Capital budgeting is the process a business undertakes to evaluate potential major projects or investments.

✅ The correct answer is A.
Return = Amount Recieved – Amount Invested
= Rs. 2000 – Rs. 1500 = Rs. 500.

✅ The correct answer is C.
Speculators are typically sophisticated risk-taking investors with expertise in the markets in which they are trading; they usually use highly leveraged investments, such as futures and options.

✅ The correct answer is C.
A technique of lowering risk for multinational companies and globally designed portfolios is classified as global diversification. Today, asset allocation has evolved beyond domestic stocks, bonds and cash to include global diversification across equities, fixed income and nontraditional investments. Global diversification can help in managing risk and positioning your portfolio for long-term growth.

✅ The correct answer is D.
Financial analysts, working capital means the same thing as current assets minus current Liabilities. Financial analyst is one of the most coveted roles in the financial services industry.

✅ The correct answer is B.
Special situation in which large projects are financed by with and securities claims on project’s cash flow is classified as project financing. Project financing is a loan structure that relies primarily on the project’s cash flow for repayment, with the project’s assets, rights, and interests held as secondary collateral. Project finance is especially attractive to the private sector because companies can fund major projects off-balance sheet.

✅ The correct answer is B.
Condition in which company’s imports are more than its exports is classified as foreign trade deficits. A trade deficit is an economic measure of international trade in which a country’s imports exceed its exports. It represents an outflow of domestic currency to foreign markets.